2Q Operating Profit of AmorePacific Down 58%

July 27, 2017 03:41|July 27, 2017 16:33

The second-quarter net profit for Hyundai Motor and AmorePacific has been cut by a half from the previous year. Even though a worse profit would be expected due to the retaliatory measures by the Chinese government in response to the Korean government's decision to deploy the Terminal High Altitude Area Defense (THAAD) system, it was a little too much. Especially for Hyundai Motor, the poor results even shook up Chinese local parts suppliers and dealer networks.

Hyundai Motor said on July 26 that its second-quarter operating and net profits were 1,344.5 billion won and 913.6 billion won, respectively on sales of 24.3 trillion won. Even though sales were down 1.5 percent from the same period last year, its operating profit and net profit were down 23.7 percent and 48.2 percent each.

Korean cosmetics companies were hit hard this time. AmorePacific, the nation's No. 1 cosmetic purveyor, posted sales of 1,413 billion won and operating profit of 130.4 billion won for the quarter, down 17.8 percent and 57.9 percent respectively from four quarters ago. During the same period, its net profit was also down 59.5 percent from 246.7 billion won to 99.9 billion won.

The lower profit results may spread to other industrial sectors. The number of Chinese tourists visiting Korea fell 64 percent in June from a year ago. The sales of Korea's duty-free shops have also plunged, with the number of Lotte Mart stores in operation falling to 12 from 99.